Thursday, November 22, 2012

Since
the nonprofit Bitcoin Foundation launched in September 2012 I have been asked
many times by potential sponsors, "Why would our organization want to support bitcoin and the
foundation?" The answer lies in the primary benefits that bitcoin
enables in society and those benefits are not always so easy to
recognize at first.

As a decentralized and nonpolitical cryptographic money, bitcoin
acts as both payment platform and unit of account. In other words, it is
both the train track and the train which is what gives bitcoin the
ability to function smoothly without third-party intermediaries.

Why is
this significant? Without intermediaries, bitcoin is not subject to
being appropriated or usurped by governments for their political agendas
in the way that monarchs assumed the privileges of minting and stamping
the gold coins of the realm, which were eventually 'clipped' and later
morphed into lower grade metals. Historically, civilized society has not
seen an opportunity like this before nor what kind of economic
revolution can be sparked by a sustainable, independent monetary unit.

The Bitcoin Foundation is an educational and software research
organization offering annual memberships and a standard donation
program. The donation program can be anonymous and is open to any group
or any individual and the funding is put to work in the same way as
membership funding. Corporations from a broad range of industries, NGOs,
and other nonprofit organizations are likely benefactors to the Bitcoin
Foundation. Through a collaborative alliance, we can extend your
organization's reach and enhance your stated mission. Below I outline
some of the significant initiative areas where we are already having a measurable
impact:

Human Rights and Social Justice
Citizens from many
countries are blocked out of the typical payment
channels like PayPal and credit cards simply because they lack access to
a bank account. Sometimes, even those that have banking infrastructures
within their countries are blocked out due to poor credit histories or
insurmountable fees. Around the globe and including remote parts of
Africa and Asia, bitcoin combined with mobile technology is providing a
means for previously disenfranchised consumers to enter the worldwide
marketplace. With the liberating power of bitcoin, responsible
individuals can take control of their own financial lives and operate as
both consumer and merchant. Now that is real financial empowerment.

Privacy

Financial privacy is a fundamental human right
but lately it has become as vulnerable as email privacy or data
privacy. You cannot take your privacy for granted -- you have to claim
it. As governments and law enforcement increasingly use money channels
as a way to track identity, they give up on the original crime that they
were investigating and everything becomes a potential monetary crime.
No one is immune to getting ensnarled in that type of fishing
expedition. The ends do not justify the means. Free speech advocates and
political dissidents can be identified and persecuted simply because of
a payment that they made to a certain group or company. Bitcoin
restores some of that balance back to the individual in that it permits
user-defined anonymity and user-defined traceability.

Sound Public Policy

Public policy efforts should aim
for freedom of choice in currencies for several economic reasons.
Quantitative easing is a sophisticated sounding term made up by the
politicians and bureaucrats. It really means inflating the money supply
but that phrase sounds too negative and irresponsible. If the sovereign
treasuries around the world can endlessly purchase their own debt and
inject liquidity into the economy via monetary and fiscal stimulus, then why
do they need taxes? Unfortunately, we suffer both taxation and growing
inflation. Average working people and the elderly are impacted the most
through the inevitable devaluation of the currency. Since Bitcoin is not
the liability of anyone else and cannot be devalued, an easy and safe
store of value is provided so that someone's life savings cannot be
inflated away by the whims of a political class.

Math and Science

Advanced mathematics and science
propels innovation and enhances the standard of living for everyone.
Technology and the Internet have already made things possible that we
never thought we would observe in our lifetimes. I look forward to more
breakthroughs and greater accomplishments. Through its freely-available,
open source software bitcoin educates individuals about cryptographic
money, public key cryptography, and distributed computing. In just under
four years the bitcoin p2p project has become the world's single
largest distributed computed project.

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About Me

I am an e-Money researcher and a Founding Director of the Bitcoin Foundation. My career has included senior influential posts at Sumitomo Bank, VISA, VeriSign, and Hushmail.

"Free-market protagonists, such as Matonis, regard cybercash as better than traditional government-issued or -regulated money, because it is determined by market forces and thus nonpolitical in nature." --Robert Guttmann, Professor of Economics at Hofstra University, in Cybercash: The Coming Era of Electronic Money, 2002

"Matonis is quite correct that the new technology makes easier the use of multiple private currencies." --Mark Bernkopf, Federal Reserve Bank of New York, in "Electronic Cash and Monetary Policy", 1996

"Matonis argues that what is about to happen in the world of money is nothing less than the birth of a new Knowledge Age industry: the development, issuance, and management of private currencies." --Seth Godin in Presenting Digital Cash, 1995